(3 minutes read)
· Business confidence in South Africa is gradually picking up as indicated by the recovery of its business confidence index
· In November, the index picked up though marginally, but to the highest level since April last year
· Low inflation and a somewhat smart recovery of trade are the factors that contributed to the recovery
Business confidence in South Africa is gradually picking up as indicated by the recovery of its business confidence index. In November, the index picked up though marginally, but to the highest level since April last year. Low inflation and a somewhat smart recovery of trade are the factors that contributed to the recovery.
A survey undertaken by .the South African Chamber of Commerce and Industry’s (SACCI) revealed that the monthly business confidence index (BCI) rose to 93.4 in November, from 92.0 in October, which is incidentally the highest since April 2019. The chamber attributed the recovery to the extent of 1.4 index points mainly to the base effect
There are other factors also, which have lifted the index such as low inflation, the recovery in certain trade categories, and the reset of international trade and commodity prices after the disruptions caused by the pandemic. That does not mean the economy is out of the woods cautioned the Chamber. The economy is still plagued by poor economic performance, high unemployment and the rapidly rising debt levels being contracted by the government.
Calling for more reforms, the Chamber said that further improvement in the economy necessitates transformational steps, such as greater importance to the private sector and greater degree of freedom to make business decisions. The Chamber said that such measures would lead to more employment.
Available data reveal that South Africa’s economy bounced in the third quarter as coronavirus restrictions were eased. The fear of a second wave of Covid-19 is dragging the growth prospects.
